[G.R. NO.

182836 : October 13, 2009]

CONTINENTAL STEEL MANUFACTURING

CORPORATION,Petitioner, v. HON. ACCREDITED VOLUNTARY
ARBITRATOR ALLAN S. MONTAO and NAGKAKAISANG
MANGGAGAWA NG CENTRO STEEL CORPORATION-SOLIDARITY OF
UNIONS IN THE PHILIPPINES FOR EMPOWERMENT AND REFORMS
(NMCSC-SUPER), Respondents.

DECISION

CHICO-NAZARIO, J.:

Before Us is a Petition for Review on Certiorari, under Rule 45 of the Rules of

Court, assailing the Decision1 dated 27 February 2008 and the
Resolution2 dated 9 May 2008 of the Court of Appeals in CA-G.R. SP No.
101697, affirming the Resolution3 dated 20 November 2007 of respondent
Accredited Voluntary Arbitrator Atty. Allan S. Montao (Montao) granting
bereavement leave and other death benefits to Rolando P. Hortillano
(Hortillano), grounded on the death of his unborn child.

The antecedent facts of the case are as follows:

Hortillano, an employee of petitioner Continental Steel Manufacturing

Corporation (Continental Steel) and a member of respondent Nagkakaisang
Manggagawa ng Centro Steel Corporation-Solidarity of Trade Unions in the
Philippines for Empowerment and Reforms (Union) filed on 9 January 2006, a
claim for Paternity Leave, Bereavement Leave and Death and Accident
Insurance for dependent, pursuant to the Collective Bargaining Agreement
(CBA) concluded between Continental and the Union, which reads:

ARTICLE X: LEAVE OF ABSENCE

xxx

Section 2. BEREAVEMENT LEAVE The Company agrees to grant a

bereavement leave with pay to any employee in case of death of the
employee's legitimate dependent (parents, spouse, children, brothers and
sisters) based on the following:

2.1 Within Metro Manila up to Marilao, Bulacan - 7 days

2.2 Provincial/Outside Metro Manila - 11 days

xxx
 ARTICLE XVIII: OTHER BENEFITS

xxx

Section 4. DEATH AND ACCIDENT INSURANCE The Company shall grant

death and accidental insurance to the employee or his family in the following
manner:

xxx

4.3 DEPENDENTS'Eleven Thousand Five Hundred Fifty Pesos (Php11,550.00)

in case of death of the employees legitimate dependents (parents, spouse,
and children). In case the employee is single, this benefit covers the
legitimate parents, brothers and sisters only with proper legal document to
be presented (e.g. death certificate).4

The claim was based on the death of Hortillano's unborn child. Hortillano's
wife, Marife V. Hortillano, had a premature delivery on 5 January 2006 while
she was in the 38th week of pregnancy.5 According to the Certificate of Fetal
Death dated 7 January 2006, the female fetus died during labor due to fetal
Anoxia secondary to uteroplacental insufficiency.6

Continental Steel immediately granted Hortillano's claim for paternity leave

but denied his claims for bereavement leave and other death benefits,
consisting of the death and accident insurance.7

Seeking the reversal of the denial by Continental Steel of Hortillano's claims

for bereavement and other death benefits, the Union resorted to the
grievance machinery provided in the CBA. Despite the series of conferences
held, the parties still failed to settle their dispute,8prompting the Union to file
a Notice to Arbitrate before the National Conciliation and Mediation Board
(NCMB) of the Department of Labor and Employment (DOLE), National
Capital Region (NCR).9 In a Submission Agreement dated 9 October 2006,
the Union and Continental Steel submitted for voluntary arbitration the sole
issue of whether Hortillano was entitled to bereavement leave and other
death benefits pursuant to Article X, Section 2

and Article XVIII, Section 4.3 of the CBA.10 The parties mutually chose Atty.
Montao, an Accredited Voluntary Arbitrator, to resolve said issue.11

When the preliminary conferences again proved futile in amicably settling the
dispute, the parties proceeded to submit their respective Position
Papers, 12Replies,13 and Rejoinders14 to Atty. Montao.
The Union argued that Hortillano was entitled to bereavement leave and
other death benefits pursuant to the CBA. The Union maintained that Article
X, Section 2 and Article XVIII, Section 4.3 of the CBA did not specifically
state that the dependent should have first been born alive or must have
acquired juridical personality so that his/her subsequent death could be
covered by the CBA death benefits. The Union cited cases wherein employees
of MKK Steel Corporation (MKK Steel) and Mayer Steel Pipe Corporation
(Mayer Steel), sister companies of Continental Steel, in similar situations as
Hortillano were able to receive death benefits under similar provisions of
their CBAs.

The Union mentioned in particular the case of Steve L. Dugan (Dugan), an

employee of Mayer Steel, whose wife also prematurely delivered a fetus,
which had already died prior to the delivery. Dugan was able to receive
paternity leave, bereavement leave, and voluntary contribution under the
CBA between his union and Mayer Steel.15Dugan's child was only 24 weeks
in the womb and died before labor, as opposed to Hortillano's child who was
already 37-38 weeks in the womb and only died during labor.

The Union called attention to the fact that MKK Steel and Mayer Steel are
located in the same compound as Continental Steel; and the representatives
of MKK Steel and Mayer Steel who signed the CBA with their respective
employees' unions were the same as the representatives of Continental Steel
who signed the existing CBA with the Union.

Finally, the Union invoked Article 1702 of the Civil Code, which provides that
all doubts in labor legislations and labor contracts shall be construed in favor
of the safety of and decent living for the laborer.

On the other hand, Continental Steel posited that the express provision of
the CBA did not contemplate the death of an unborn child, a fetus, without
legal personality. It claimed that there are two elements for the entitlement
to the benefits, namely: (1) death and (2) status as legitimate dependent,
none of which existed in Hortillano's case. Continental Steel, relying on
Articles 40, 41 and 4216 of the Civil Code, contended that only one with civil
personality could die. Hence, the unborn child never died because it never
acquired juridical personality. Proceeding from the same line of thought,
Continental Steel reasoned that a fetus that was dead from the moment of
delivery was not a person at all. Hence, the term dependent could not be
applied to a fetus that never acquired juridical personality. A fetus that was
delivered dead could not be considered a dependent, since it never needed
any support, nor did it ever acquire the right to be supported.

Continental Steel maintained that the wording of the CBA was clear and
unambiguous. Since neither of the parties qualified the terms used in the
CBA, the legally accepted definitions thereof were deemed automatically
accepted by both parties. The failure of the Union to have unborn child
included in the definition of dependent, as used in the CBA - the death of
whom would have qualified the parent-employee for bereavement leave and
other death benefits - bound the Union to the legally accepted definition of
the latter term.

Continental Steel, lastly, averred that similar cases involving the employees
of its sister companies, MKK Steel and Mayer Steel, referred to by the Union,
were irrelevant and incompetent evidence, given the separate and distinct
personalities of the companies. Neither could the Union sustain its claim that
the grant of bereavement leave and other death benefits to the parent-
employee for the loss of an unborn child constituted "company practice."

On 20 November 2007, Atty. Montao, the appointed Accredited Voluntary

Arbitrator, issued a Resolution17ruling that Hortillano was entitled to
bereavement leave with pay and death benefits.

Atty. Montao identified the elements for entitlement to said benefits, thus:

This Office declares that for the entitlement of the benefit of bereavement
leave with pay by the covered employees as provided under Article X, Section
2 of the parties' CBA, three (3) indispensable elements must be present: (1)
there is "death"; (2) such death must be of employee's "dependent"; and (3)
such dependent must be "legitimate".

On the otherhand, for the entitlement to benefit for death and accident
insurance as provided under Article XVIII, Section 4, paragraph (4.3) of the
parties' CBA, four (4) indispensable elements must be present: (a) there is
"death"; (b) such death must be of employee's "dependent"; (c) such
dependent must be "legitimate"; and (d) proper legal document to be
presented.18

Atty. Montao found that there was no dispute that the death of an
employee's legitimate dependent occurred. The fetus had the right to be
supported by the parents from the very moment he/she was conceived. The
fetus had to rely on another for support; he/she could not have existed or
sustained himself/herself without the power or aid of someone else,
specifically, his/her mother. Therefore, the fetus was already a dependent,
although he/she died during the labor or delivery. There was also no question
that Hortillano and his wife were lawfully married, making their dependent,
unborn child, legitimate.

In the end, Atty. Montao decreed:

WHEREFORE, premises considered, a resolution is hereby rendered
ORDERING [herein petitioner Continental Steel] to pay Rolando P. Hortillano
the amount of Four Thousand Nine Hundred Thirty-Nine Pesos (P4,939.00),
representing his bereavement leave pay and the amount of Eleven Thousand
Five Hundred Fifty Pesos (P11,550.00) representing death benefits, or a total
amount of P16,489.00

The complaint against Manuel Sy, however, is ORDERED DISMISSED for lack
of merit.

All other claims are DISMISSED for lack of merit.

Further, parties are hereby ORDERED to faithfully abide with the herein
dispositions.

Aggrieved, Continental Steel filed with the Court of Appeals a Petition for
Review on Certiorari,19under Section 1, Rule 43 of the Rules of Court,
docketed as CA-G.R. SP No. 101697.

Continental Steel claimed that Atty. Montao erred in granting Hortillano's

claims for bereavement leave with pay and other death benefits because no
death of an employee's dependent had occurred. The death of a fetus, at
whatever stage of pregnancy, was excluded from the coverage of the CBA
since what was contemplated by the CBA was the death of a legal person,
and not that of a fetus, which did not acquire any juridical personality.
Continental Steel pointed out that its contention was bolstered by the fact
that the term death was qualified by the phrase legitimate dependent. It
asserted that the status of a child could only be determined upon said child's
birth, otherwise, no such appellation can be had. Hence, the conditions sine
qua non for Hortillano's entitlement to bereavement leave and other death
benefits under the CBA were lacking.

The Court of Appeals, in its Decision dated 27 February 2008, affirmed Atty.
Montao's Resolution dated 20 November 2007. The appellate court
interpreted death to mean as follows:

[Herein petitioner Continental Steel's] exposition on the legal sense in which

the term "death" is used in the CBA fails to impress the Court, and the same
is irrelevant for ascertaining the purpose, which the grant of bereavement
leave and death benefits thereunder, is intended to serve. While there is no
arguing with [Continental Steel] that the acquisition of civil personality of a
child or fetus is conditioned on being born alive upon delivery, it does not
follow that such event of premature delivery of a fetus could never be
contemplated as a "death" as to be covered by the CBA provision,
undoubtedly an event causing loss and grief to the affected employee, with
whom the dead fetus stands in a legitimate relation. [Continental Steel] has
proposed a narrow and technical significance to the term "death of a
legitimate dependent" as condition for granting bereavement leave and death
benefits under the CBA. Following [Continental Steel's] theory, there can be
no experience of "death" to speak of. The Court, however, does not share this
view. A dead fetus simply cannot be equated with anything less than "loss of
human life", especially for the expectant parents. In this light, bereavement
leave and death benefits are meant to assuage the employee and the latter's
immediate family, extend to them solace and support, rather than an act
conferring legal status or personality upon the unborn child. [Continental
Steel's] insistence that the certificate of fetal death is for statistical purposes
only sadly misses this crucial point.20

Accordingly, the fallo of the 27 February 2008 Decision of the Court of

Appeals reads:

WHEREFORE, premises considered, the present petition is hereby DENIED for

lack of merit. The assailed Resolution dated November 20, 2007 of
Accredited Voluntary Arbitrator Atty. Allan S. Montao is hereby AFFIRMED
and UPHELD.

With costs against [herein petitioner Continental Steel].21

In a Resolution22 dated 9 May 2008, the Court of Appeals denied the Motion
for Reconsideration23 of Continental Steel.

Hence, this Petition, in which Continental Steel persistently argues that the
CBA is clear and unambiguous, so that the literal and legal meaning of death
should be applied. Only one with juridical personality can die and a dead
fetus never acquired a juridical personality.

We are not persuaded.

As Atty. Montao identified, the elements for bereavement leave under

Article X, Section 2 of the CBA are: (1) death; (2) the death must be of a
dependent, i.e., parent, spouse, child, brother, or sister, of an employee; and
(3) legitimate relations of the dependent to the employee. The requisites for
death and accident insurance under Article XVIII, Section 4(3) of the CBA
are: (1) death; (2) the death must be of a dependent, who could be a
parent, spouse, or child of a married employee; or a parent, brother, or sister
of a single employee; and (4) presentation of the proper legal document to
prove such death, e.g., death certificate.

It is worthy to note that despite the repeated assertion of Continental Steel

that the provisions of the CBA are clear and unambiguous, its fundamental
argument for denying Hortillano's claim for bereavement leave and other
death benefits rests on the purportedly proper interpretation of the terms
"death" and "dependent" as used in the CBA. If the provisions of the CBA are
indeed clear and unambiguous, then there is no need to resort to the
interpretation or construction of the same. Moreover, Continental Steel itself
admitted that neither management nor the Union sought to define the
pertinent terms for bereavement leave and other death benefits during the
negotiation of the CBA.

The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code
for the legal definition of death is misplaced. Article 40 provides that a
conceived child acquires personality only when it is born, and Article 41
defines when a child is considered born. Article 42 plainly states that civil
personality is extinguished by death.

First, the issue of civil personality is not relevant herein. Articles 40, 41 and
42 of the Civil Code on natural persons, must be applied in relation to Article
37 of the same Code, the very first of the general provisions on civil
personality, which reads:

Art. 37. Juridical capacity, which is the fitness to be the subject of legal
relations, is inherent in every natural person and is lost only through death.
Capacity to act, which is the power to do acts with legal effect, is acquired
and may be lost.

We need not establish civil personality of the unborn child herein since
his/her juridical capacity and capacity to act as a person are not in issue. It is
not a question before us whether the unborn child acquired any rights or
incurred any obligations prior to his/her death that were passed on to or
assumed by the child's parents. The rights to bereavement leave and other
death benefits in the instant case pertain directly to the parents of the
unborn child upon the latter's death.

Second, Sections 40, 41 and 42 of the Civil Code do not provide at all a
definition of death. Moreover, while the Civil Code expressly provides that
civil personality may be extinguished by death, it does not explicitly state
that only those who have acquired juridical personality could die.

And third, death has been defined as the cessation of life.24 Life is not
synonymous with civil personality. One need not acquire civil personality first
before he/she could die. Even a child inside the womb already has life. No
less than the Constitution recognizes the life of the unborn from
conception,25 that the State must protect equally with the life of the mother.
If the unborn already has life, then the cessation thereof even prior to the
child being delivered, qualifies as death.
Likewise, the unborn child can be considered a dependent under the CBA. As
Continental Steel itself defines, a dependent is "one who relies on another for
support; one not able to exist or sustain oneself without the power or aid of
someone else." Under said general definition,26even an unborn child is a
dependent of its parents. Hortillano's child could not have reached 38-39
weeks of its gestational life without depending upon its mother, Hortillano's
wife, for sustenance. Additionally, it is explicit in the CBA provisions in
question that the dependent may be the parent, spouse, or child of a married
employee; or the parent, brother, or sister of a single employee. The CBA did
not provide a qualification for the child dependent, such that the child must
have been born or must have acquired civil personality, as Continental Steel
avers. Without such qualification, then childshall be understood in its more
general sense, which includes the unborn fetus in the mother's womb.

The term legitimatemerely addresses the dependent child's status in relation

to his/her parents. In Angeles v. Maglaya,27 we have expounded on who is a
legitimate child, viz:

A legitimate child is a product of, and, therefore, implies a valid and lawful
marriage. Remove the element of lawful union and there is strictly no
legitimate filiation between parents and child. Article 164 of the Family Code
cannot be more emphatic on the matter: "Children conceived or born during
the marriage of the parents are legitimate." (Emphasis ours.)

Conversely, in Briones v. Miguel,28 we identified an illegitimate child to be as

follows:

The fine distinctions among the various types of illegitimate children have
been eliminated in the Family Code. Now, there are only two classes of
children - - legitimate (and those who, like the legally adopted, have the
rights of legitimate children) and illegitimate. All children conceived and
born outside a valid marriage are illegitimate, unless the law itself gives them
legitimate status. (Emphasis ours.)

It is apparent that according to the Family Code and the afore-cited

jurisprudence, the legitimacy or illegitimacy of a child attaches upon his/her
conception. In the present case, it was not disputed that Hortillano and his
wife were validly married and that their child was conceived during said
marriage, hence, making said child legitimateupon her conception. rbl rl l lbrr

Also incontestable is the fact that Hortillano was able to comply with the
fourth element entitling him to death and accident insurance under the
CBA, i.e., presentation of the death certificate of his unborn child.
Given the existence of all the requisites for bereavement leave and other
death benefits under the CBA, Hortillano's claims for the same should have
been granted by Continental Steel.

We emphasize that bereavement leave and other death benefits are granted
to an employee to give aid to, and if possible, lessen the grief of, the said
employee and his family who suffered the loss of a loved one. It cannot be
said that the parents' grief and sense of loss arising from the death of their
unborn child, who, in this case, had a gestational life of 38-39 weeks but died
during delivery, is any less than that of parents whose child was born alive
but died subsequently.

Being for the benefit of the employee, CBA provisions on bereavement leave
and other death benefits should be interpreted liberally to give life to the
intentions thereof. Time and again, the Labor Code is specific in enunciating
that in case of doubt in the interpretation of any law or provision affecting
labor, such should be interpreted in favor of labor.29 In the same way, the
CBA and CBA provisions should be interpreted in favor of labor. In Marcopper
Mining v. National Labor Relations Commission,30we pronounced:

Finally, petitioner misinterprets the declaration of the Labor Arbiter in the

assailed decision that "when the pendulum of judgment swings to and fro
and the forces are equal on both sides, the same must be stilled in favor of
labor." While petitioner acknowledges that all doubts in the interpretation of
the Labor Code shall be resolved in favor of labor, it insists that what is
involved-here is the amended CBA which is essentially a contract between
private persons. What petitioner has lost sight of is the avowed policy of the
State, enshrined in our Constitution, to accord utmost protection and justice
to labor, a policy, we are, likewise, sworn to uphold.

In Philippine Telegraph & Telephone Corporation v. NLRC [183 SCRA 451

(1990)], we categorically stated that:

When conflicting interests of labor and capital are to be weighed on the

scales of social justice, the heavier influence of the latter should be counter-
balanced by sympathy and compassion the law must accord the
underprivileged worker.

Likewise, in Terminal Facilities and Services Corporation v. NLRC [199 SCRA

265 (1991)], we declared:

Any doubt concerning the rights of labor should be resolved in its favor
pursuant to the social justice policy.
IN VIEW WHEREOF, the Petition is DENIED. The Decision dated 27 February
2008 and Resolution dated 9 May 2008 of the Court of Appeals in CA-G.R. SP
No. 101697, affirming the Resolution dated 20 November 2007 of Accredited
Voluntary Arbitrator Atty. Allan S. Montao, which granted to Rolando P.
Hortillano bereavement leave pay and other death benefits in the amounts of
Four Thousand Nine Hundred Thirty-Nine Pesos (P4,939.00) and Eleven
Thousand Five Hundred Fifty Pesos (P11,550.00), respectively, grounded on
the death of his unborn child, are AFFIRMED. Costs against Continental
Steel Manufacturing Corporation.

SO ORDERED.